Main menu:

History of RPE Thought

Posts by Tag

RSS New from the CCPA

  • Boom, Bust and Consolidation November 9, 2018
    The five largest bitumen-extractive corporations in Canada control 79.3 per cent of Canada’s productive capacity of bitumen. The Big Five—Suncor Energy, Canadian Natural Resources Limited (CNRL), Cenovus Energy, Imperial Oil and Husky Energy—collectively control 90 per cent of existing bitumen upgrading capacity and are positioned to dominate Canada’s future oil sands development. In a sense they […]
    Canadian Centre for Policy Alternatives
  • A new Director for CCPA's BC Office: Message from Mary Childs, Board Chair October 24, 2018
    The CCPA-BC Board of Directors is delighted to share the news that Shannon Daub will be the next BC Director of the Canadian Centre for Policy Alternatives. Last spring, Seth Klein announced that, after 22 years, he would be stepping down as founding Director of the CCPA-BC at the end of 2018. The CCPA-BC’s board […]
    Canadian Centre for Policy Alternatives
  • Who Owns Canada’s Fossil-Fuel Sector? October 15, 2018
    The major investors in Canada’s fossil-fuel sector have high stakes in maintaining business as usual rather than addressing the industry’s serious climate issues, says a new Corporate Mapping Project study.  And as alarms ring over our continued dependence on natural gas, coal and oil, these investors have both an interest in the continued growth of […]
    Canadian Centre for Policy Alternatives
  • Pharmacare consensus principles released today September 24, 2018
    A diverse coalition representing health care providers, non-profit organizations, workers, seniors, patients and academics has come together to issue a statement of consensus principles for the establishment of National Pharmacare in Canada. Our coalition believes that National Pharmacare should be a seamless extension of the existing universal health care system in Canada, which covers medically […]
    Canadian Centre for Policy Alternatives
  • Kate McInturff Fellowship in Gender Justice September 19, 2018
    The CCPA is pleased to announce the creation of the Kate McInturff Fellowship in Gender Justice.This Fellowship is created to honour the legacy of senior researcher Kate McInturff who passed away in July 2018. Kate was a feminist trailblazer in public policy and gender-based research and achieved national acclaim for researching, writing, and producing CCPA’s […]
    Canadian Centre for Policy Alternatives
Progressive Bloggers

Meta

Recent Blog Posts

Posts by Author

Recent Blog Comments

The Progressive Economics Forum

The Novel Observations of Jean Tirole?

French economist Jean Tirole has won the 2014 Nobel Prize in Economics for his work on industrial organization and regulation, in particular his insights into oligopolies.  “Who is Jean Tirole?,  many non-economists and some economists are asking today.  The MIT-educated, Toulouse-based professor is a key figure in the New Industrial Organization (IO) movement.  The movement, with its roots in the 80s ,  sought to formalize IO, drawing heavily on new tools provided by game theory.  I first came across Tirole’s name as the author of The Theory of Industrial Organization (1988),   the main textbook prescribed in the grad level IO course that I chose not to take in 2000.  However, as I now scramble to get quite familiar with the IO of banking, I can appreciate an  overarching insight of Tirole’s: there is no general theory of IO or regulation!  Every industry is different; they are dynamic and require regulations or competition policies that address their particular conditions.

But Tirole’s contributions don’t end there.  In the hours since the announcement by the Nobel committee, news and blogs have been rife with summaries of the essential Tirole.  Yet as I digest these, I can’t help recall a passage written by the late Mark Blaug in a 1998 Challenge article:

In the field of industrial organization, which has been more systematically invaded by game theory than any other branch of economics, its principal effect has been to pour old wine into new bottles.  It is difficult, nay, impossible to think of a single novel observation that has come out of the “new’ industrial organization infuse by game theory that was not already part and parcel of the “old” industrial organization based as it was on the so-called structure-conduct-performance approach to business behavior.”

Blaug goes on to compare an old-style textbook like Scherer and Ross’ “Industrial Market structure and Economic Performance” (1990)  and Tirole’s 1988 text, asserting that “there is nothing of substance in the latter that is not also in the former and indeed  there is much less substance in the latter than in the former.”

So, as we scurry to get up to speed on the latest dismal scientist to get named to the hall of fame, it may be worthwhile to consider the whole history of industrial organization, with its pioneering theorists of imperfect competition, such as Joe Bain , Edward Chamberlain and Joan Robinson.

Enjoy and share:

Comments

Comment from Larry Kazdan
Time: October 15, 2014, 1:06 am

Hold Your Wallet When the Swedish Central Bank Prize Rewards “Clever”
By William K. Black

http://neweconomicperspectives.org/2014/10/hold-wallet-swedish-central-bank-prize-rewards-clever.html

“Tirole failed to recognize or understand the criminogenic environments that produced the three epidemics of home lending fraud that were evident at the time he wrote his book. There is no evidence that he understands those three fraud epidemics even today. He exemplifies the tragedy and staggering opportunity costs of economics and economists.”

Write a comment





Related articles